In August 2024, the used car market displayed a remarkable resilience amid fluctuating economic and seasonal factors. According to the latest data from Auto Trader, the average price of a used car stood at £16,316. Although this figure represents a minor decrease of -0.1% compared to the previous month, it marks a significant improvement over the -0.8% drop recorded in August of the previous year and the -0.4% decline in 2019. Historically, August has seen a typical price drop of around -0.5%, so this month’s performance suggests a relatively stable market.
The slight decline in prices is overshadowed by a robust performance in the 1-5-year-old car segment. These vehicles, driven by strong demand and limited supply, experienced a modest price increase of 0.2% month-on-month (MoM). This segment’s resilience underscores a favourable imbalance in supply and demand, with the volume of used cars advertised decreasing by -5.3% year-on-year (YoY). This marks the fifth consecutive month of contraction in advertised volumes, the most significant decline since July last year.
Consumer appetite for used cars remains strong, with transactions up approximately 3% YoY despite the distraction of Olympic festivities. This uptick in demand, coupled with a decrease in supply, has led to a healthy market environment. Auto Trader’s Market Health metric, which evaluates supply and demand dynamics, increased significantly from 8.2% in July to 13.3% YoY in August.
The market’s vitality is reflected in consumer engagement, with Auto Trader recording around 82 million visits in August—an increase of 6% from the previous year and a substantial 20% compared to August 2022. The average time for a used car to sell has decreased to just 28 days, a full three days faster than in August last year.
A closer examination reveals that the market dynamics vary across different vehicle types. For instance, demand for used petrol cars rose by 7.4% YoY, while supply contracted by a similar rate. This imbalance has led to a significant 15.9% increase in Market Health for petrol cars, with their average price reaching £14,681. Conversely, used electric vehicles (EVs) saw a dramatic 49% rise in demand. However, this surge in demand was matched by a 45.3% increase in supply, leading to a more modest 2.3% rise in Market Health and a slight decrease in average EV prices to £26,736.
Notably, 3-5-year-old electric cars have performed exceptionally well, with consumer interest soaring by 132.3% YoY. Despite a 157% increase in supply, the strong demand has pushed average prices for this segment to £18,846, marking the first price rise in over two years. These vehicles are selling particularly quickly, averaging just 22 days on the market.
Richard Walker, Auto Trader’s Data & Insights Director, commented on the market’s resilience, stating, “Despite various distractions, including major sporting events, consumer demand for used cars remains robust. Our outlook for the latter part of 2024 is very positive, with strong pockets of profit potential available for retailers.”
Sue Robinson, Chief Executive of the National Franchised Dealers Association (NFDA), added, “As summer ends, the used car market continues to show positive signs. The combination of strong consumer demand and faster sales, despite fewer cars available, supports a healthy and profitable market.”
